It’s not a good time for Aussie exporters reliant on China, but there are other markets to pounce on.

For several years until 2020, several Aussie exporters (ranging from infant formula makers to wine producers) hedged their bets on China’s growing middle class and it appeared to be paying dividends.

This was particularly true for a handful ASX listed companies such as A2 Milk (ASX:A2M) and Treasury Wines Estates (ASX:TWE) which saw rapid growth during the 2010s.

Australia’s reliance on China got to the point where as Rabobank analyst Tim Hunt described it: “We haven’t been this exposed to one market since the 1950s, when we were still joined at the hip to the UK.”

2020 saw the run grind to a halt with COVID-19 hitting China’s demand for Aussie exports, first because of the world’s first lockdowns and then diplomatic tensions.

Several ASX stocks that had put all their eggs in the China basket paid the price and plunged.


Post-China opportunities for Aussie exporters

This morning a couple of small cap stocks with aspirations to be major Aussie exporters rose from company updates. And neither of them mentioned China.

One of these is EVE Investments (ASX:EVE) which is taking a big step into the US market. Amazon (NDQ:AMZN)-owned organic grocery chain Whole Foods has agreed to stock EVE’s organic honey products beginning in Northern California.

EVE anticipates the initial products will hit the stores by April.

Managing director Bill Fry said this was an important milestone and the company had further ambitions to expand in the US.

Another is Digital Wine Ventures (ASX:DW8) which has an ecommerce platform for wine sales.

While it is likewise at an early stage with its ambitions, DW8 is eyeing several markets. It named the USA, UK, Europe, Canada, Hong Kong and Singapore this morning – but not China.

In a company update this morning, Digital Wine Ventures announced it had signed on another four wineries as customers, three in New Zealand and one in the USA. The company also welcomed another 12 vineyards, most of which were in South Australia’s McLaren Vale.

It also revealed it had shipped 25,000 cases in December, up 1,000 per cent month on month.

In the last 12 months, EVE shares are up 40 per cent while Digital Wine Ventures shares have gained 600 per cent.

EVE Investments (ASX:EVE) and Digital Wine Ventures (ASX:DW8) share price chart